Gone are the days of imaginary friends and climbing trees. Toddlers and pre-schoolers are not immune to the increasing role of technology in society. In fact, the majority of parents are welcoming mobile forms of entertainment with open arms (58% of US parents agree that digital entertainment is a good playtime activity for children), thereby creating demand for more high-quality tech toys.

From Blue’s Clues to Dora the Explorer, children have always loved to talk to their favorite characters. Now, thanks to a former Pixar employee, those characters are talking back.

On September 25, startup company ToyTalk launched SpeakaLegend, an app that enables children to hold intelligible conversations with mythical creatures such as jackalopes, dragons, and sphinxes.

“What do people usually wish for?” a fairy asks in a preview clip for the game.

“I wish I had an iPhone,” a girl responds.

“Oh! Those are like magic apples!”

Though SpeakaLegend itself seems like magic, it depends on advanced technology to function. The game works by recognizing speech – no easy feat when chattering children are involved – and then selecting a response from an ever-evolving repository of pre-recorded answers.

If verbal conversation weren’t enough, SpeakaLegend is the first ToyTalk game to incorporate tactile elements. With the swipe of a finger, children can make a Cyclops jump or change a mermaid’s hair color, earning stars in the process. The depth of interaction is so rich that children average 45 minutes of playtime on ToyTalk’s apps – an impressive accomplishment considering children’s short attention spans.

The SpeakaLegend app is available for only $2.99 on iOS devices. Low-cost apps like this may reshape the children’s entertainment market as they become more advanced and gain in popularity. Traditional toy manufacturers may be able to take advantage of this change by creating digital games to complement their physical toys.

Click here for more information about how parents keep their toddlers and preschoolers entertained in and out of the home.

Lindsey Rogers is a Junior Analyst at Mintel. In addition to writing stories for Mintel’s daily news alerts, she produces sections for multicultural, lifestyle, leisure, and travel reports.